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UK Oil Production Down 12.8% in Q3 2005; Demand Up

According to statistics released today by the UK’s Department of Trade and Industry (DTI), the country’s oil production dropped 12.8% in the third quarter of 2005 compared to Q4 2004.

Although seven new fields have started production since September 2004, their production is insufficient to compensate for the general decline in production from older established fields, according to DTI.

With production reaching only 19.3 million tonnes (152 million barrels, or 1.7 mbpd), the UK tipped over into the net oil importer column, requiring 2.4 million tonnes (19 million barrels).

With its North Sea wealth, the UK has been a major producer of petroleum and natural gas in the EU, and has been a net exporter for decades. (It is also the fourth-largest consumer of oil in the EU.)

Given declines in the fields, however, analysts had predicted that the UK will become a net importer of both oil and natural gas by 2010, according to the EIA.

The DTI also ascribed the drop in production to a large amount of planned maintenance work on North Sea oil platforms that coincided with the shutdown of the large Schiehallion field because of a fire and the prolonged planned maintenance shutdown of one major oil refinery.

Overall primary demand for oil products in the third quarter of 2005 increased by 2.2% cent. The largest percentage change in demand year-on-year was in aviation fuel, which increased 15.6%. Demand for gasoline dropped 6.0%, but demand for on-road diesel increased 6.9%.

Quantitatively, demand for DERV (Diesel Engine Road Vehicle) fuel exceeded demand for gasoline in terms of mass for the first time. Volumetrically, however, gasoline sales exceeded those of diesel by about 25 million gallons US.

UK Primary Oil Products Demand, Q3 2005
Product 2005 Q3
Thousand tonnes
Change from Q4 2004
Gasoline 4,671 -6.0%
Diesel 4,915 +6.9%
Aviation fuel 3,921 +15.6%

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